Employers unprepared for car tax changes

Nearly half (48%) of employer respondents said their organisations are unprepared for the changes to company car taxes that came into effect on 1 April, according to research by LeasePlan.

The research, which surveyed 350 senior managers with decision-making responsibility around company cars, found that 51% of respondents said the tax changes would place further strain on their organisation.

More than a third (38%) said they would be interested in guidance on how to manage the new legislation.

The changes, which took effect from 1 April 2013, apply to vehicle excise duty (VED) car tax bands. Those in band A to C (up to 120g/km of CO2 emissions) will not see a change. However, those in further bands (121g/km of CO2 emissions and higher) will see their tax rate increase.

The government also announced in the Budget 2013 on 20 March that a new, ultra low emission company car tax will come into effect from 2015.

David Brennan, managing director at LeasePlan, said: “These tax changes have been introduced with the laudable intention of promoting the adoption of lower-emitting vehicles.

Sign up to our newsletters

Receive news and guidance on a range of HR issues direct to your inbox

This field is for validation purposes and should be left unchanged.

“However, our research shows that fleet managers may not be aware of, or adequately prepared for, the specific tax impact these measures may have on their business. 

“Our research has made it clear that there is an appetite for specialist advice around understanding these technical measures, and if explained properly, there is no need for [employers] to fear the impact upon their fleets.”